Policy And Economic Challenges Of China's Coal Industry

Since joining the WTO in 2001, the Chinese government has stated their intention to create a diversified energy consumption structure in order to supplement the country's rapid and continuous development and reduce reliance on energy from coal. However, the proportion of coal energy production and consumption has in fact increased. Moreover, China's coal consumption continues to rise as the country's economy and industry expand. To address this issue, the Chinese government has established many policies on coal consumption and energy production. Coal-related polices are divided into three parts, namely those contained; in the'11th Five-year Plan for Energy Development (2006-2010)', the'11th Five-year Plan for the Development of the Coal industry (2006-2010)', and the'Coal Industrial Policy (2007)'.The main purpose of this thesis is to assess the likelihood of success of the latter's policy goals with regards to the supply and demand for coal and the restructuring of the industry, based on an analysis of the Chinese government's policy on coal. It is estimated herein that restructuring efforts will in fact result in a supply shortage. This supply shortage is expected to have a negative influence on the success of the industry restructuring effort which constitutes another major goal of the coal polices.